ApeCoin (APE-USD) tore through April with aggressive gains and a lot investor interest. This hype culminated with the weekend’s Otherside metaverse land sale, which has proved to be a wild success. However, APE crypto prices haven’t been able to stay hot.
The ApeCoin network had been preparing for a big catalyst at the end of April courtesy of Yuga Labs. The company behind the Bored Ape Yacht Club non-fungible token (NFT) collection had been cooking up its own metaverse space. It publicly announced the project at the end of March, just after ApeCoin’s launch.
As part of this announcement, Yuga Labs also announced its intention to support the virtual space with APE infrastructure, making ApeCoin the de-facto currency of what many suspect to be a dominant metaverse.
In April, APE prices really began sizzling. After the company announced that it would be conducting a series of auctions for pieces of real estate within the Otherside space, APE saw rapid price appreciation.
ApeCoin Prices Slip in the Aftermath of Otherside Land Sale
The event initially was structured as a Dutch-style auction, where users bid whatever they are comfortable paying and the highest-paying bidder for each piece wins. Of course, ApeCoin is the official Otherside crypto, meaning these auctions would be conducted in APE. With the Dutch auction format, users had an incentive to accrue as much APE as possible in order to make the highest bid. As a result, ApeCoin trading volumes have been riding high, helping to spur price growth.
But just a day before the auction on Saturday, Yuga Labs said it was ditching the Dutch-style auction. Instead, it said it would sell plots at a flat rate of 305 APE, and the fastest buyers would be the ones to walk away with Otherside land. This news didn’t lead to an APE price drop right away, but it certainly caused the token to lose some steam. By Friday afternoon, APE prices were trading sideways for what seemed like the first time all month.
So far, the auction is proving massively successful; Yuga Labs has generated $561 million as a result of the sale of 55,000 NFTs. It was so successful, in fact, that the sale caused a massive spike in the easily bottlenecked Ethereum (ETH-USD) transaction validation process. Gas fees on the network spiked as high as $14,000 to process a single transaction thanks to the traffic boom.
The token sale is showing to be a big win for Yuga Labs. However, it also appears to be marking the end of a bullish ApeCoin run. Since the sale, APE is dealing with a series of losses. This morning, prices are down nearly 6%, and trading volume is down by 40% over the past 24 hours.
On the date of publication, Brenden Rearick did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.